Friday, July 8, 2011

Lift your apple cider glass and celebrate the end of a costly NAFTA dispute

The end of a small tariff war with Mexico could mean mucho dinero for Washington's agricultural industry.

One of the provisions of the 1994 North America Free Trade Agreement allowed commercial trucks open access across the US borders with both Mexico and Canada.

But access on this side of the border was not fully granted due to safety and environmental concerns. And in 2009, Congress cut funding for a pilot program to allow long-haul Mexican trucks to circulate in the U.S.

In retaliation, Mexico placed tariffs on 99 American products including tree fruit - our very own cherries, pears, apricots and, of course, apples. These tariffs have cost our fruit growers tens of millions of dollars.

But there’s good news in the very, very near future, as an agreement signed Wednesday will allow U.S. and Mexican trucks to freely transport goods across the shared border.

Consequently, Mexico will soon remove the tariffs. Twenty percent will be reduced almost immediately and the rest will come off in the fall. Great timing, too, because Mexico is Washington’s largest apple export market.

According to the Yakima Herald story:

Mexico is the state's largest apple export market, accounting for more than 10 million boxes annually. The 20 percent tariff imposed on apples in 2010 has cost growers an estimated $44 million annually.

Losses to the pear, cherry and apricot industries are estimated at $30 million since those products were first subjected to the tariff in 2009, according to estimates provided by the Northwest Horticultural Council. The council represents Northwest growers on trade and regulatory issues.

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